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UnitedHealth Group (UNH) Gains But Lags Market: What You Should Know


UnitedHealth Group (UNH) closed at $259.41 in the latest trading session, marking a +0.89% move from the prior day. This move lagged the S&P 500′s daily gain of 1.42%. Elsewhere, the Dow gained 1.15%, while the tech-heavy Nasdaq added 2.29%.

Prior to today’s trading, shares of the largest U.S. health insurer had lost 3.15% over the past month. This has was narrower than the Medical sector’s loss of 5.63% and the S&P 500′s loss of 5.36% in that time.

Investors will be hoping for strength from UNH as it approaches its next earnings release, which is expected to be October 16, 2018. In that report, analysts expect UNH to post earnings of $3.30 per share. This would mark year-over-year growth of 24.06%. Our most recent consensus estimate is calling for quarterly revenue of $56.13 billion, up 11.54% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $12.72 per share and revenue of $224.86 billion, which would represent changes of +26.32% and +11.78%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for UNH. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.04% higher. UNH is currently sporting a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that UNH has a Forward P/E ratio of 20.21 right now. This valuation marks a premium compared to its industry’s average Forward P/E of 18.47.

We can also see that UNH currently has a PEG ratio of 1.53. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. UNH’s industry had an average PEG ratio of 1.4 as of yesterday’s close.

The Medical – HMOs industry is part of the Medical sector. This group has a Zacks Industry Rank of 59, putting it in the top 23% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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